ARTICLE: BOST Twin Towers – who overpriced, NPP or NDC?
BOST followed laid-down procedures as prescribed under the Public Procurement Act. Claims by the NDC that the deal was overpriced are not supported by the facts
Evidence available to Asaase News shows that the Minority’s allegation of government overpricing of an ongoing project for the Bulk Oil Storage and Transportation Company (BOST) are inaccurate and not supported by documents covering the contract.
The Minority caucus alleges that a contract sum for the construction of a single-unit tower estimated at US$39 million has been inflated to US$78 million and that the transaction has received approval from the Public Procurement Authority (PPA).
Addressing the press in Parliament today (28 July 2022), John Abdulai Jinapor, the MP for Yapei-Kusawgu and ranking member of Parliament’s mines and energy committee said the Minority is convinced that the current government is deliberately causing financial loss to the state.
“We are firm in our conviction that this is a classic case of causing financial loss to the state. This is another PDS, Ameri and Movenpina scandal in the making,” Jinapor said.
“The energy sector under the current NPP administration has become a pollution haven for regularised corruption, inflated favouritism and rusted nepotism,” the Yapei-Kusawgu lawmaker said.
Value-for-money audit
However, documents available to Asaase News shows that on 5 June 2015 BOST entered into a contract to construct a twin-tower head office building at a cost of $39 million, exclusive of taxes, and in 2016 BOST made an advance payment of $8 million for the work to begin, with subsequent payments as agreed under contract terms.
Construction of the project began in January 2016 and was projected to be completed in January 2018.
Work on the BOST head office building was however suspended and delayed to enable BOST to undertake a value-for-money audit after the Akufo-Addo government came into office in 2017.
The contract was also fraught with challenges for myriad reasons, including financial challenges and the need for further scrutiny by the Economic and Organised Crime Office (EOCO).
Nonetheless, after investigating the contract, EOCO did not establish any wrongdoing in relation to it. The Attorney General subsequently advised BOST to engage Rolider, in the absence of any vitiating factors, and to proceed with executing the project as originally agreed.
The conclusions drawn by EOCO and the Attorney General’s Department thus cleared BOST management of any element of illegality associated with the project.
However, Rolider rejected the initial findings from the value-for-money audit, which was undertaken by the Ghana Institution of Surveyors at the instance of BOST. A mutually acceptable independent assessor was subsequently engaged to re-evaluate the project.
The parties committed and agreed that the report of the independent assessor would be final and binding on both BOST and Rolider. The final report showed that the total development cost had increased from US$39 million to US$49,535,787 (exclusive of all taxes) during the four-year delay.
Revised cost
In a letter dated 12 October 2021 from the managing director of BOST, Edwin Provencal, to the acting chief executive officer of the Public Procurement Authority, BOST requested ratification of the contract between BOST and Rolider Ghana Ltd.
On 19 May 2022, the PPA board, in line with Section 90(3)c of Act 663 as amended, ratified the engagement of Messrs Rolider Ltd to construct the BOST head office at a contract sum of US$39 million.
Following ratification of the engagement of Messrs Rolider Ltd, the BOST board of directors resolved that, given the financial constraints, BOST could not afford the twin towers but would rather proceed to negotiate with the contractor to procure a single block.
On 26 May 2022, the PPA, at the request of BOST, granted approval, in accordance with Section 87 of Act 663, to vary the contract for construction of the BOST head office building by opting for a one-block structure instead of the original twin-tower building. The revised cost of the project was pegged at US$24 million.
From these details, it is clear that BOST followed the laid-down procurement procedures, as prescribed in the Public Procurement Act. Claims by the NDC that the BOST head office project was overpriced are, therefore, not supported by the facts of the case.
Wilberforce Asare
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